You can always submit a guarantor with income, that will help in your scoring. You need to submit your 6 months part time (sales invoices etc) and the corresponding bank statements that can prove the transaction. Cash payments cannot be considered as it is not traceable.

Not having any loan may not be a good thing, as bank is unable to see your repayment trend. Do make sure you pay promptly for your Credit card. All the best.

A 10 year old car may not get any financing anymore as banks are not keen for cars that are 10 years or older. Some credit companies may still wanna do the loan but the interest rate is higher. Anyway, do check with the banks directly for confirmation as they may make exception for some car models.

Average interest rate as 3.8% or so before MCO, not sure of the latest rate though.

Here are some rates approved for KIA cars recently:
120K 9 years 2.38 %
80K 9 years 2.41 %
72K 7 years 2.37 %
65K 7 years 2.38 %
165K 9 years 2.36 %

Best rate is still for 5-7 years. 8-9 years rate is higher, as well as anything lower than 5 years period. And of course, the higher the loan amount, the lower the interest rate.

HP car loan is quite straight forward, not many hidden conditions unlike other loans or investment. With online banking, it is now much easier to pay your installment via IBG instead of walking to the bank branches, so not having a lot of physical outlets, is not that much of an issue now.

A slight concern is with regards to late payment fee & interest, which may vary from one bank to another. Bank usually don't highlight nor explain this openly and it's probably in fine print in the agreement. That is, if you are really into the nitty-gritty of things and you have a tendency to pay late. Otherwise, it shouldn't be a big bother.

Also, when it comes to doing an EARLY full settlement of your car, ( eg when you sell off the car before the loan tenure ends ) the remaining balance settlement will be computed and generated by the bank system. How much rebate (vs Interest incurred for late payment) you get at the end for early settlement is usually not very clear or transparent as it is SYSTEM generated. There has been no attempt to compare the performance of the banks in this respect and most of us just trust the figure that is being given to us. The only controlling body is Bank Negara and we just have to trust what is being given to the consumers is fair and true reflection of the loan account.

Based on Fixed rates

In any Sdn Bhd company loan, the company director must stand as personal guarantor, which is a requirement and not an option. Banks usually need to look at minimum 6 months bank statement with active transactions. I think it would be very difficult for bank to approve with just 2 months of business transactions, as they need to look at the average positive cash flow for past 6 months. Some companies also need to submit their audited accounts , in order for bank to know that the company is a profitable company.

Yes, bank will consider it as a second hand unit and it is subjected to higher interest.

When you take a loan from bank, the car dealer actually gets a RM 600 as a form of handling fee, which is extra profit. When you buy cash, they are deprived of this. As such, car dealers actually prefer if you can take a loan, provided your loan can be approved with ease and with minimum hastle because timing is also a factor. Car industry is all about cash flow management and how fast the stocks are moved.

To the company, not to the sales person. It is disbursed together with the loan.

In my opinion, it is best to take fixed rate at this moment, because interest is at an all time low. It doesn't make good money sense to take variable rate because when economy recovers in the long run, the interest rate would only go up. On the contrary, if the interest rate is very high, then taking variable rate is worth doing, to capitalize on lower interest when OPR/BLR goes down.


Most banks, either conventional or Islamic loan are in FIXED rate for auto loans. Only limited banks like Maybank do offer variable rate.

Cars are depreciating assets, so fixed rate would hedge it better against depreciation and inflation, especially those taking 9 years tenure. There are many cases of payment defaults, where banks need to repossess the cars and auctioned them, many times at a loss, even after factoring in the interest. Fixed rate would take away many uncertainties so that auto loans can continue to be profitable for banks.

The other thing is of course is, if you take a 9 year loan, but settle the loan within 2 years, you are not going to get a clean waiver of interest of 7 years under FIXED rate, unlike that of housing loan. As such, when you do early settlement of the auto loan, the fund goes back to the bank system with "added" profit and that is what drives the economy.

That's just my take.

I can emphatize with the sales person, because usually we can tell more or less which bank is giving the lowest rate, in the market. The thing is if sales person were to submit one case to 8 banks and each time, ending up only 1 bank ( presumably with the lowest interest) gets to close the loan, the other 7 banks would shy away from processing applications from this sales person in future because all their effort do not turn into success and have "wasted" a lot of their time.
As such, those banks would rather concentrate of cases that have "higher" chance of closing. Therefore, sales person need to play fair with the banks so that they are treated favourably too.

Usually, sales person try the multiple banks application only, if the case is borderline eg one bank approve but others reject, so as not to waste precious waiting time. It is not so much on comparing interest rate. Just my 2cents.

HP Life, offered by the bank, is an insurance plan to pay off the remaining loan in event of the owner's death or Permanent disability. The ownership of the car will then be passed on to the next of kin /beneficiary named in the policy.

Yes, on one hand, it protects the bank's interest, but on the other, it also helps the next of kin, who needs the car as a mode of transport. Would strongly advice to take it, if the car is a family car, often shared by the spouse and/or the spouse stands as a guarantor for the loan.

Because in event of the owners' death/permanent disability, the guarantor is liable to settle the loan anyway and such a protection would be a welcome relief.

Yes, you are right, the bank can always repossess the car. However, if any family member eg spouse had stood as a guarantor, the bank would first demand that the guarantor continues to service the loan. If the guarantor fails to do so, the car would be auctioned off, and if there is any shortfall in the auction price and balance loan settlement, the guarantor would be responsible for it. The last thing for someone who had lost their love one ever wanted, is to also bear the consequences of the deceased liabilities, house, cars etc... Not taking responsibility of it could also affect the credit worthiness of the guarantor, because after all, life has to go on....

To each, his own then, depending on your situation i.e single or married / loan with guarantor or without/ young or old/sharing car or not. I have personally had a customer who, after her husband had passed on, contacted me to check if they have bought any HP auto life, or she would loose the car she needs to the bank.

Sometimes, guarantor is required as joint-income with the borrower, due to high commitment or insufficient income. Other times , the bank need it as the applicant is only border-line in the scoring, (eg due to not so "impressive" repayment record) and a guarantor would increase the bank confidence in granting the loan.

That's just for paper work. Do consult your SA . If he had committed an OTR price to you, then that price should apply and not anything more.

Hint : Bank Negara ruling, maximum financing by all banks for auto loan shall be NOT more than 90% of the OTR selling price

Each car has its own valuation of market value, hence banks would only finance based on that market value. When you change to a different model, the valuation of that model changes . If you change from a lower to higher valued model (eg cold model to a popular & highly in demand model), chances are banks can grant you the same loan amount and condition. Unfortunately, the reverse also can happen when you choose a less popular model.

If you plan to change dealer, it might as well be a fresh loan application, because banks usually work with their panel used-car dealer only. If both dealers share the same bank as panel, then no problem.